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SUSTAINABILITY EFFECTIVE CORPORATE FINANCIAL ADDITIONAL DETAILS OF THE ANNUAL
REPORT LEADERSHIP GOVERNANCE STATEMENTS INFORMATION GENERAL MEETING

GROuP CHIEF EXECuTIVE OFFICER

REVIEW

2020 MARKET OVERVIEW

Global and local markets were hit by an unprecedented
impact from COVID-19 in 2020 that continues to reverberate
into 2021. This has changed the landscape of business and
challenged many industries, some of which, such as travel
and hospitality, are recording immense setbacks following
the travel bans and other virus containment measures 23
imposed by the Government.

Generally, the business community in Malaysia is experiencing the Industry customers were facing export supply chain
tighter cash flow due to enforced business closures as part disruptions. Nonetheless, consumption trends have been
of the government’s movement control order (MCO) from improving since Q3 2020 based on the positive operational
March to May 2020. For the food and beverage sector, earnings of the Group since July 2020.
manufacturers started regulating productions which directly
affects the consumption of sugar. Domestic economic The weak sales volume in Domestic segment has been MSM MALAYSIA HOLDINGS BERHAD Annual Report 2020
recovery has also been further hampered with the supplemented by an increased Export segment sales volume.
Conditional Movement Control Order (CMCO) announced in The refined sugar volume has recorded a significant increase
quarter 4 (Q4) of 2020 due to the third wave of COVID-19. by almost threefold the volume recorded last year mainly
This has caused a drop in domestic sugar consumption for influenced by increase Premium which contributed to an
the wholesale and industry segment for 2020. increase in revenue of more than RM200 million whilst new
export products such as Liquid Sugar (LS), Fine Syrup (FS) and
The sharp slowdown in economic activities is expected to Premix Sugar (PS) contributed to an increase in revenue of
contract Malaysia’s GDP by at least 3.1% in 2020 according to approximately more than RM80 million.
World Bank projections.
On the operations and reliability front, MSM continued to
deliver up to customer expectations during the year and
2020 PERFORMANCE REVIEW ensured sufficient sugar supply towards the nation. One of
the highlights of the year was the celebration of ‘Gula Prai’
Overall, MSM’s financial performance was mainly affected
by lower sugar consumption in the domestic wholesale as a trusted brand, with over 50 years of experience in sugar
and industry segment due to MCO since late March 2020. refining industries. Through the tagline ‘Sweetening the lives
During the year under review, the Group’s domestic sales of Malaysians since 1964’, a refreshed brand positioning was
volume dropped by 110,000 tonnes or 13% lower compared introduced to strengthen brand positioning and create top of
to the prior year and revenue loss was approximately mind awareness of Malaysia’s longest serving sugar brand.
RM118 million. During the initial phase of MCO, most of Towards this end, MSM also introduced a new packaging for
the domestic customers suspended their operations whilst ‘Gula Prai’ to reflect the brands long heritage in Malaysia.

“ DURING THE INITIAL PHASE OF MCO, MOST OF THE DOMESTIC CUSTOMERS SUSPENDED
THEIR OPERATIONS WHILST THE INDUSTRY CUSTOMERS WERE FACING ExPORT SUPPLY CHAIN
DISRUPTIONS. NONETHELESS, CONSUMPTION TRENDS HAVE BEEN IMPROVING SINCE q3 2020
BASED ON THE POSITIVE OPERATIONAL EARNINGS OF THE GROUP SINCE JULY 2020. “